Borrowers with historic credit problems and smaller deposits have more routes to explore, but understanding which lenders can help remains central to the advice process.

That was a recurring theme in the latest edition of Knowledge Bank’s Lenders Live, alongside a discussion about whether technology is giving mortgage professionals more control over their working day.

Hosted by Shane Chawatama, sales director at Knowledge Bank, episode 193 brought together Scott Smith, mortgage and protection adviser at KAG Financial; Neil McLeod, national key account manager at Metro Bank and Anum Mahmood, national sales director at Afin Bank.

IMPAIRED CREDIT

The discussion opened with Broadstone’s analysis of FCA data showing a rise in impaired-credit mortgage sales, prompting the panel to consider how far the sector had moved beyond its traditional specialist boundaries.

Smith said he was seeing more clients with credit issues following the pandemic and pressure on household finances. However, a growing number of lenders were willing to consider these borrowers, creating opportunities for people who might assume a past credit problem ruled them out.

McLeod said there was greater recognition that an isolated default did not necessarily indicate whether someone would maintain their mortgage payments.

Conduct since the event could provide a more useful picture, while improved data and different underwriting approaches enabled lenders to look beyond a credit score.

Mahmood emphasised the importance of brokers understanding the available options and keeping their knowledge of lender criteria current.

“Brokers need to be educated enough,” she said. “As long as they know the criteria and they know which lenders out there can serve their customers, that’s really, really important.”

The panel also considered whether borrowers with credit concerns might favour a product transfer because it appeared simpler than looking elsewhere. Smith said remaining with an existing lender could suit some customers, although plans to move home or increase their borrowing might require a different assessment.

For brokers, the key was establishing what happened, when it happened and how the customer’s finances had developed since. Those details could determine which lenders were worth researching and challenge the assumption that the borrower’s only options were to stay put or accept a much higher rate.

The audience remained divided over whether impaired credit had become a mainstream consideration, with votes split equally between the three available responses. The discussion underlined why the distinction remained difficult: lender choice had widened, but each customer’s circumstances still mattered.

LOW-DEPOSIT LENDING

The panel also examined growth in low-deposit lending and the products designed to help buyers struggling to save while paying rent.

Smith said the immediate concern for many of his clients was whether homeownership was achievable. Without family support, even a deposit of 5% or 10% could feel beyond reach.

McLeod welcomed the range of approaches emerging across the market. Publicity around a low-deposit mortgage could encourage someone who had dismissed homeownership to approach a broker. That conversation might reveal that saving a little more, or combining existing savings with a family gift, would open up other options.

The panel also acknowledged the risks of higher repayments and negative equity. Advisers could use a customer’s initial interest to explore their circumstances and future plans alongside the costs, conditions and limitations of the available products.

TIME SAVED BY TECHNOLOGY

Technology formed the final part of the discussion, including the frustration of entering the same information into multiple systems and the benefits of tools that reduce administration.

McLeod highlighted applications such as meeting notes, call summaries and compliance support, which could free brokers to spend more time with customers. However, he questioned the assumption that every hour saved should be used to write more business.

Smith reflected on the effect of long working hours on concentration and efficiency, while Mahmood encouraged mortgage professionals to use technology to support their work and create more time away from their screens.

The panel left providers with a practical challenge: make systems easier to use together and reduce the administrative burden on brokers, giving them a meaningful choice over how to use the time saved.

Register and take part in the next Lenders’ Live HERE.